Observing that it was concerned about the home buyers who had put their entire life savings, the Supreme Court, on January 31, 2018, asked real estate firm Amrapali to submit a plan on completion of its projects and said that funds should not be diverted to something else. “Comprehensive proposal, with respect to all the projects, including details about stages of work, funds needed and timeline for completion, should be filed by the company in seven days”, a bench of justices Arun Mishra and Amitava Roy said.
The top court observed that it should desist from ‘asking for refund of money to the home buyers’ and it should be done ‘only in the case when the projects are not viable’. It also asked the authorities of Noida and Greater Noida, the Committee of Creditors, the Interim Resolution Professional (IRP) and other parties, to file their responses to the proposal submitted by the company in 10 days and posted the matter for further hearing on February 21, 2018.
At the outset, advocate ML Lahoty, appearing for the home buyers, said this was the case of 42,000 flats owners in various projects of Amrapali, who are seeking refund of their money. Hence, as directed by the top court in the Jaypee case, flat owners should be directed to register their names in a portal, he said, adding that currently the portal was restricted for registration of home buyers of only Silicon City project of the company.
The bench said this was a ‘serious issue’ and a ‘complicated case’, wherein it has to go into the details of the money paid by home buyers and the loans and mortgage made to secure that loan. Senior advocate Ranjit Kumar, appearing for Amrapali, said one Galaxy Developers had come forward, to develop the flats in a timely manner. He said the pending flats will be completed in seven phases from 2018 to 2021 as under the Real Estate (Regulation and Development) Act, 2016 (RERA), it has time till 2022 to complete the project. “The money of home buyers will be diverted to an escrow account and will only be used for completion of projects”, Kumar said.
Senior advocate CU Singh, appearing for the home buyers of Silicon City project, objected to the demand of additional money by the IRP from the flat buyers and said it should be quashed. The bench said it will consider all aspects, once the comprehensive proposal is submitted by the company and directed the Amrapali Group to install fire safety equipments at the Silicon City project in four weeks. It also directed the IRP to not raise objection to the fire safety work done by the real estate firm in the project.
The National Company Law Tribunal (NCLT) had admitted insolvency proceedings against Amrapali Group and appointed an interim resolution professional to manage the affairs of the company on September 4, 2017. The top court was hearing a batch of pleas filed by flat buyers, who have sought quashing of the September 4 NCLT order and said the moratorium imposed under the provisions of the Insolvency and Bankruptcy Code, 2016, is violative of Article 14 (equality before law) of the Constitution.